The Feasebility Analysis of Public Investment: Evidence of Reservoir

Abstract

: Farmers need water urgently, especially in District of Gunungkidul, because their farm’s irrigation depend on rainfall. It is not a lucky condition. They face drought in dry season, but rudundant water is in rainy season. Moreover, their area covered by water significantly. Therefore, irrigation management is urgent for the local government, such as build a reservoir for providing water supply constantly. This study aims to perform feasibility analysis approach, namely net present value, benefit cost ratio, and internal return rate. This study also implement sensivity analysis through different schema of interest rate. Prior research has implemented economic analysis to examine public investment, but in this case, the reservoir’s project has to release communities’ land and communities’ vegetation. This study reveals that the project of Embung Kedung Poh is eligible to execute and this result contributes to reseach about public investment that have to sacrifice private land and vegetation.